Denver’s tourism promoters have added a twist to their plan to ask voters to boost funding for marketing the area: A percentage-point increase in the city’s tax on car rentals.
For several months, the Denver Metro Convention and Visitors Bureau has floated the idea of boosting the city’s lodging tax on hotel stays by a percentage point to collect nearly $3 million a year to market tourism.
On Wednesday, convention bureau officials told a City Council committee that a similar hike of the city’s car-rental tax would push the total gathered annually to at least $5.6 million.
Bureau officials stress that their plan remains conceptual, adding that they need to continue vetting the proposal with tourism businesses. The proposed tax hikes require the approval of Denver voters and could be on the ballot in November.
The convention bureau proposes to use roughly a third, or $2 million, of the new money to market the recently expanded Colorado Convention Center to national groups. It would use the remaining roughly $4 million to sell the metro area to leisure travelers.
A percentage-point increase of the city’s lodging tax and car-rental tax would not gouge tourists, said Richard Scharf, president and chief executive of the convention bureau.
“The last thing we want to do is scare anyone off,” he said. “We’re not out to raise money. We’re out to increase tourism for the economic well-being of the city.”
Denver’s car-rental tax still would be lower than that of 18 other U.S. cities after such an increase, and its lodging tax would be lower than 29 others, Scharf said.
Yet, while Denver hotel operators so far have voiced no opposition to a potential lodging-tax increase, at least one-car rental agency is not happy about a possible boost in the rental tax.
“It will definitely affect business,” said Traci Esch, director of marketing operations at San Antonio-based Advantage Rent-A-Car, which operates at Denver International Airport. “The issue we’ve always had with raising car-rental taxes is are you burdening customers with too high of fees?”
The convention bureau now gets most of its $8 million annual budget from a dedicated portion of the city’s 13.85 percent lodging tax.
The city’s 13.35 percent car- rental tax does not finance the convention bureau.
Denver councilwoman Jeanne Faatz grilled Scharf on Wednesday about aspects of the proposal, asking whether neighboring counties should help pay for tourism promotion. To that, Scharf noted that establishments within Denver receive 90 percent of the benefit from the visitors bureau’s marketing.
Faatz, the council’s lone Republican, also suggested that the city should offer the tourism-promotion work for a competitive bid. Scharf countered that no agency carries the experience, capability and credibility of the visitors bureau.
Staff writer Kris Hudson can be reached at 303-820-1593 or khudson@denverpost.com.
Staff writer Julie Dunn can be reached at 303-820-1592 or jdunn@denverpost.com.
